Mobiles are calling time on the payphone market

The Middle East’s GSM boom has impacted heavily on the payphone market — according to a new report.

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By  Patrick Phelvin Published  March 24, 2004

The Middle East’s GSM boom has impacted heavily on the payphone market — according to a new report. While the payphone market is still growing in some Arab countries, like Morocco, a report from the Arab Advisors Group shows that in countries such as Jordan the market has stagnated. Arab Advisors’ research shows that Morocco has the highest number of installed payphones in the examined countries while the UAE has the highest payphone penetration. The advent of mobile phones has significantly reduced the popularity of payphones. Moreover, fixed line prepaid cards substitute the need for installing payphones. “Morocco is the Arab World’s leading payphone market, size and usage wise. The country is followed by Saudi Arabia, Egypt, Tunisia, UAE, Syria, Algeria, Bahrain and Qatar,” says Serene Zawaydeh, Arab Advisors Group’s senior research analyst. “On the other extreme lies Jordan which has seen its two private payphone operators close down and currently has no payphone service to speak of,” she says. “Morocco’s installed payphones base constitute 7.5% of mainlines. This high percentage of total mainlines is indicative of why the mainline service in Morocco has declined over the past years: Many Moroccans choose to receive calls on prepaid mobiles, and make calls using the neighborhood’s payphone booths,” Zawaydeh explains. “The UAE has the highest payphones penetration rate (0.76%) amongst the listed countries, and its payphones constituted 2.7% of total mainlines.” In Jordan the two payphone service companies, ALO and JPP, have shut down, while in Bahrain the payphones service is struggling. Egypt and Morocco, however, remain viable markets for payphone services. As for Saudi Arabia, the influx of millions of pilgrims every year makes for an ideal context for payphone services in the Kingdom. In addition, the service seems to still have its client base in Algeria, Tunisia and Syria. In Syria a project for installing 8000 new payphones is scheduled for 2005, but no offers have been submitted for the tender yet. As for Algeria, card-based payphones have been a recent addition to the market. The new report, “Is the payphone market in the MENA region becoming as an unattractive as the struggling paging market?” was released to Arab Advisors Group Strategic Research Service subscribers on March 23, 2004. The 5-page report covers and analyses the payphone markets in the ten Arab countries of Morocco, Saudi Arabia, Egypt, Tunisia, UAE, Syria, Algeria, Bahrain, Qatar and Jordan.

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